BOSTON, MA - JUNE 28: In this photo illustration, a Blue Apron box waits to be opened on a kitchen counter on June 28, 2017 in Boston, Massachusetts. The online meal-kit delivery company is going public and has lowered their upcoming IPO price range from $15 to $17 a share to $10 to $11 a share. (Photo by Scott Eisen/Getty Images)

We have the news that Amazon looks like entering the prepared meal kits business and Blue Apron stock looks like it's been shot as a result--the people who will benefit here being of course consumers which is what competition always does do in a capitalist free market. That lust for the pelf and lucre that can be made, the profits from selling to consumers can indeed make those who get it right rich. It's the competition between that capitalists hungry for the loot which benefits consumers--they have to keep making their offer better and better until we bite. It's hugely important for us to understand this part of the process for it's this part which makes us all as gargantually rich as we are, hugely, vastly, rich by any global or historical standard. It's the competition, not the capitalism which is the important part:

Investors’ fears about Amazon Inc. coming after Blue Apron Inc. may be realized.

I'll admit that it's not an offering that's going to be of much interest to me. My idea of hassle free cooking is a restaurant with a damn good head waiter. But, you know, tastes and habits differ.

Blue Apron, a meal-kit delivery service backed by major investors including Fidelity, Bessemer Venture Partners and First Round Capital, has seen shares fall after hitting the public market in late June. The stock has shed nearly 30 percent month to date.

Well, you know, we're all going to cry for the capitalists, right? At which point it is now near ritual for me to trot out this paper:

The present study examines the importance of Schumpeterian profits in the United States economy. Schumpeterian profits are defined as those profits that arise when firms are able to appropriate the returns from innovative activity. We first show the underlying equations for Schumpeterian profits. We then estimate the value of these profits for the non-farm business economy. We conclude that only a minuscule fraction of the social returns from technological advances over the 1948-2001 period was captured by producers, indicating that most of the benefits of technological change are passed on to consumers rather than captured by producers.

I trot it out so often that what was once a sprightly pony is closer to an old nag now. But the finding of the paper is that the entrepreneurs, those ones who innovate and create these new products--and prepared meal kits are just such--end up with about 3% of the total value they create. Near all of the rest of it comes to us out here, the users, as the consumer surplus.

What this Amazon and Blue Apron story gives us is an opportunity to explain why. So, start with Adam Smith, who didn't quite put it in these words. Capitalists are greedy and lazy. They want to make profit, the more the better. So, when they see someone doing well in a new field, with a new idea, they all pile in to try and get a bit of that above average profit. That Blue Apron is still losing money doesn't matter here, the same is true of potential profit. As that capital floods into the scene that increases competition of course. That means prices to us fall, variations of the offer increase, we're made better off. The competition also lowers those profits from the new idea down to something more like the average across the economy. At which point, rinse and repeat and our lazy and greedy capitalists are off looking for the next excess profit opportunity. Leaving behind that new business area, that new supply to us, with about the best prices that can be achieved consistent with the average return to capital or thereabouts.

So, what has happened? Blue Apron seems to have something which is at least potentially very interesting, those prepared meal kits. What is then happening? Not that I would describe Amazon as lazy but as good capitalists they're seeing that this is a business they might also enter. What is the result? Likely profit margins from the business slump, that's why the Blue Apron stock does. How and why would likely profits slump? Because the competition will limit what we the consumers can be charged.

It does all fit together. Amazon challenging Blue Apron will be of benefit to consumers as this free market capitalism always does achieve. The fall in APRN is the very proof we need of this contention.